Just in time & kanban, lean

Dr.S.Balasubramaniam

Table 1-1 Comparing Manufacturing and Service Operations

Manufacturers Services

Tangible product. Intangible product.

Product can be inventoried. Product cannot be inventoried.

Low customer contact. High customer contact.

Longer response time. Short response time.

Capital intensive. Labor intensive.

1. JIT- A philosophy of continuous im p ro vement that puts emphasis on prevention rather than
correction, and demands a company wide focus on quality. • JIT- operational management
approach to achieve world class manufacturing. • JIT- production is based on demand
2. JIT philosophy means getting the right quantity of goods at the right place and the right time
JIT exceeds the concept of inventory reduction; it is an all-encompassing philosophy geared
to eliminate waste, anything that does not add value • A broad JIT view – or le a n p ro d uc
tio n/le a n s y s te m s - is one that encompasses the entire organization 4
3. Evolved in Japan after World War II, as a result of their diminishing market share in the auto
industry. • Toyota Motor Company- Birthplace of the JIT Philosophy Under Taiichi Ohno. •
JIT is now on the rise in American Industries.
4. JIT originated in Japan at Toyota Motor Co, fueled by a need to survive the devastation post
WWII • JIT gained worldwide prominence in the 1970s • Often termed “Lean Production” or
“Lean Systems” • Broad view that entire organization has the same goal - to serve customers
5. • JIT is built on simplicity - simpler is better. • Continuous improvement • Visibility – all
waste must be visible to be identified and eliminated • Flexibility - to adapt to changes in
environment 7
6. Total Quality Management • Production Management • Supplier Management • Inventory
Management • Human Resource Management
7. Traditional Flow Production Process (stream of water) Suppliers Flow with JIT Suppliers
Customers Inventory (stagnant ponds) Material (water in stream) Customers
8. Total Quality Management • Pro d uc tio n M na g e m e nt a • Supplier Management •
Inventory Management • Human Resource Management
9. Communication Techniques • Completion of task-Kanban • Problem- Andon or siren/light •
Stopping the process if something goes wrong =Jidoka • Preventive Maintenance
10. Wa s te (“muda” in Japanese) is ‘anything other than the m inim um amount of equipment,
materials, parts, space, and worker’s time, which are absolutely essential to a d d va lue to the
product.’ — Shoichiro Toyoda Founder, Toyota © 1995 Corel Corp.
11. Single card • Move only containers with C (Conveyance)kanban) • e.g.: Kawasaki • Dual
card • Move only container with C- kanban • Produce only when authorized by P
(Production)- kanban • e.g.: Toyota
12. Total Quality Management • Production Management • Supplier Management • Inventory
Management • Human Resource Management

13. Toyota communicates their demand for parts 20 days in advance to their suppliers, with the
right to change the forecast up to the 10th day.
14. Total Quality Management • Production Management • Supplier Management • Inventory
Management • Human Resource Management
15. Inventory = Lead Time (less is better) • Inventory hides problems 19
16. W hen inventory levels are low, quality problems become very visible.
17. Self-Inspection of work • Diversified Employees • Absenteeism • To eliminate boredom in
process • Management Support and Empowerment of workforce

18. In 1986 from a labor force of 60,000 Toyota received 2.6 million improvement proposals,
96% of which were implemented by either management or the employees themselves.
19. Worker resistance • Lack of top management support • Lack of communication • Lack of
formal training
20. What phrase best describes the Just-In-Time philosophy? Continuous Improvement
21. There are so many companies that are using JIT planning. Any car, motorbike or aircraft
manufacture uses JIT. This means that the examples are countless. For example, • Toyota •
Dell • Harley Davidson •W almart • McDonalds • Xerox
22. Dell has also leveraged JIT principles to make its manufacturing process a success. • Dell’s
approach to JIT is different in that they leverage their suppliers to achieve the JIT goal.
23. Dependable suppliers with the ability to meet Dell’s demanding lead time requirements. • A
seamless system that allows Dell to transmit its component requirements so that they will
arrive at Dell in time to fulfill its lead times. • A willingness of suppliers to keep inventory on
hand allowing Dell to be free of this responsibility.
24. Harley Davidson’s use of JIT is mostly characterized by its transformation in the late World
War 2 era from an inefficient manufacturer that solved all of its problems with extra
inventory to a nimble manufacturer able to meet demand and
25. Inventory levels decreased 75 percent. • Increased productivity. Harley Davidson’s success
with the implementation of JIT had a lot to do with the fact that when JIT was put into
practice, process problems could no longer be hidden by costly inventory that helped to meet
ship dates. The inefficiencies in the processes were quickly identified and solved.
26. The main BENEFITS of JIT are the following: Funds that were tied up in inventories can be
used elsewhere. Areas previously used to store inventories can be used for other more
productive uses. Throughput time is reduced, resulting in greater potential output and
quicker response to customers. Defect rates are reduced, resulting in less waste and greater
customer satisfaction. A real business example: Dell Computer Corporation

27. DISADVANTAGES of JIT: Implementing thorough JIT procedures can involve a major
overhaul of business systems -it may be difficult and expensive to introduce. JIT
manufacturing also opens businesses to a number of risks, notably those associated with the
supply chain. With no stocks to fall back on, a minor disruption in supplies to the business
from just one supplier could force production to cease at very short notice.
A real business example: Toyota
28. W have been the experiences of hat JIT implementers so far? 22 companies had underrtaken
JIT efforts at the time of the study. W hile 13 of them reported some efforts such as
experimental and ad hoc modification of systems, 9 reported major JIT efforts in place. Most
of the firms with some JIT efforts reported starting their efforts only recently. Those with
major JIT pro-grammes had started their efforts as early as in 1986. Firms with major JIT
programmes indicated an implementation lead time of more than three years. Supplier
development, Employee involvement, and Top Management commitment were prominently
listed as critical success factors.

29. Training, task force formation, re-layout, and pilot study were indicated as among the first
five steps taken in JIT implementation. Three most important reasons for embarking upon a
JIT implementation programme were gaining competitive advantage in the market place,
simplifying production planning & control, and curbing rising inventory levels. Proximity of
suppliers, stable production plan, or high volume repetitive manufacturing were never
mentioned among the main reasons for JIT implementation. Firms reporting major JIT
efforts have done so after carefully evaluating this strategic nature. On the contrary, firms
reporting some ad hoc modification and experimental efforts did not do any strategic
planning exercise. JIT efforts were initiated by middle management because the top
management asked them to do so.
30. JIT- A philosophy of continuous improvement that puts emphasis on prevention rather than
correction, and demands a companywide focus on quality.

LEAN
A philosophy of manufacturing based on planned elimination of waste and on continuous
improvement of productivity.
What is lean production? What does it involve?
A philosophy of production that emphasizes the minimization of the amount of resources
(including time) used in the various activities of the enterprise.

It involves identifying and eliminating non-value-added activities in design, production, supply

chain management, and dealing with customers.
What is JIT and lean system's approach to operation
- Simplify first, add technology second
- Gradual however continuous improvement
- Minimize waste (including poor quality)
- Maximize use of people
What are Personnel and organizational elements to this?
- Workers as assets
- Cross-trained workers
- Greater responsibility at lower levels
- Leaders as facilitators, not order givers
What is the difference between Mass production and JIT?
Traditionally, mass production involved buying shipment in big purchase, sending it off to a big
"lot" sized factory to "push" material to next stage. There would be holding costs plus there was
a generally a big "push" of finished goods that would stay in the warehouse.

Now, JIT allows smaller shipments with minimal to no holding costs at the factory and you make
only what you need, no more no less.
What are advantages of JIT?
- Tighter coordination along the supply chain
- Goods are pulled out by customer demand
- smaller lots
- faster setup
- less inventory, more storage space
- "pull" material to next stage
- Work Centers closer together (eliminate / reduce movement and space)
- Set up times reduced
What are five JIT goals?
- Eliminate disruptions
- Make the system flexible
- Reduce setup times and lead times
- Minimize inventory
- Eliminate waste
Define Waste
any activity that does not add value to the good or service in the eyes of the consumer.
What are forms of waste?
- Overproduction
- Waiting
- Unnecessary movement
- Wrong process
- Unnecessary inventory
- Excess motion
- Defects
- Underutilization of employees
Inventory as a waste requires/causes - Requires more storage space
- Requires tracking and counting
- Increases movement activity
- Hides yield, scrap, and rework problems
- Increases risk of loss from theft, damage, obsolescence
Explain the Lean Perspective
Process of reducing inventory leads to reduction of the other "wastes" and exposes problems in
order of severity.
What are potential causes for excess inventory in the JIT system?
- Equipment Breakdowns
- Absenteeism
- Poor Quality
Define Pull System
A production system in which actual downstream demand sets off a chain of events that pulls
material through the various process steps.
What is also known as a pull system
kanban system
Define a Kanban System
A production control approach that uses containers, cards, or visual cues to control the
production and movement of good through the supply chain
What are examples of a Kanban System
- Empty slot in hamburger chute
- Yellow square on floor or designated storage spaces
- Kanban card
What are three key characteristics of the Kanban system?
1. Simple signaling mechanism (i.e. card) to indicate an item should be produced or moved
2. Synchronize activities within a plant or across the Supply Chain
3. Control mechanism designed to "pull" parts through the Supply Chain (can be used with
MRP)
What is the two card Kanban system
a special form of the kanban system that used 1 card to control production and another card to
control movement of materials
What is the move system?
a kanban card that issued to indicate when a container of parts should be moved to the next
process step
What is the production card?
a kanban card that is used to indicate when another container of parts should be produced
What must occur to synchronize the supply chain using Kanban system?
To synchronize the supply chain, there must be a smooth, consistent flow of material through the
supply chain links.